Broadband providers await Eircom’s MRD

24 Oct 2005

The end may be in sight for a long-running dispute over local loop unbundling (LLU) between incumbent Eircom and the Commission for Communications Regulation (ComReg) when Eircom delivers its much-anticipated market requirements document (MRD) on Monday to the regulator plus LLU access seekers BT, Smart Telecom and Magnet.

LLU refers to the process by which the last mile of Eircom’s copper network into homes and businesses is opened up for use by competitors. It is seen in many countries as a vital means of increasing the spread of DSL broadband. Effectively it governs licensed operators placing their equipment on Eircom exchanges.

Industry insiders say that if the MRD is progressive, in the sense that both Eircom and the industry find common ground that they can work on, Irish homes and businesses could soon enjoy broadband speeds of up to 24Mbps as consumed in some European countries today because innovation and investment would flourish.

Eircom’s decision to issue the MRD to ComReg and the various LLU access seekers stems from its defeat of ComReg in a High Court action in August. The High Court held ComReg could not use an enforcement order to compel Eircom to implement the decision in January around LLU that Eircom was in the process of appealing to an appeal panel.

In a form of settlement following the case, Eircom told ComReg that it will issue an MRD on 24 October.

At a recent strategy briefing, ComReg commissioner John Doherty told siliconrepublic.com he hoped Eircom’s request for the market would be reasonable. “When it issues the MRD we will decide if Eircom is correct in its request. LLU is a key regulatory priority for ComReg. We need to get a seamless LLU system in place that could speed up LLU. We would hope that the industry’s needs in terms of automation and wholesale numbering will be met and it will be fit for the purpose of furthering the progress of LLU in Ireland.”

Industry insiders say the MRD will be historical and pivotal in progressing LLU and maturing Ireland’s telecoms industry in terms of competition and infrastructure. It is understood that licensed operators are concerned primarily with three core issues: number portability; the migration of customers from wholesale line rental and bitstream broadband to LLU; and the bulk migration of bitstream users to LLU.

The importance of a progressive stance by Eircom was outlined by one industry insider: “At present most broadband products in Ireland are the same and pivot around Eircom’s 2Mbps bitstream product. There are a lot of ‘me too’ services. Progress on LLU whereby operators can access exchanges would result in more innovation, lower costs and better customer service arguably because operators will own their own electronics.

“In France, some providers are offering 24Mbps services. In the UK, LLU operator Bulldog is providing 8Mbps services. This has spurred incumbent BT into trialling 8Mbps services, so you get an indication of what’s possible when there’s real competition in the market,” the insider explained. “There’s an incentive for BT to do it because LLU operators are doing it. Competition offers the incentive to drive speeds higher. That’s what Ireland needs because there’s no cable or LLU competition.”

Tom Hickey, chairman of Alternative Licensed Telecom Operators, said the MRD is vital for Ireland to catch up with the rest of the world in terms of telecoms. He highlighted a report by ECTA, a European association of alternative telecom service providers, that showed Ireland has come in second-last place in a European league table that tracks broadband adoption. Ireland is at the bottom of the table in 14th position out of 15 EU countries measured for this survey.

“This paints a sorry picture of where we are at in terms of LLU. The impact of lack of progress on LLU is that there are less providers out there investing, which means less choice for consumers and businesses,” Hickey explained.

“Operators in Ireland should be free to migrate customers in a way that doesn’t disrupt customer service and do it in a planned way. We would expect that Eircom will be reasonable and that there won’t be any difficulties.

“In the UK BT has realised that there are benefits and this brought about a new regulatory deal with Ofcom. It wouldn’t have made that decision lightly, it considered the benefits and saw the withdrawal of the burden of regulation in certain markets. The same benefits are there for Eircom. While we can’t copy the exact same model as the UK, the same principles apply,” Hickey said.